Powered by MOMENTUM MEDIA
SUBSCRIBE TO OUR NEWSLETTER SIGN UP
Powered by MOMENTUM MEDIA

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.

RBA reveals pre-Christmas cash rate

rba    rba
Tim Neary 4 minute read

The Reserve Bank announced its cash rate decision for the month of December this afternoon, set against a backdrop of a property market that continues to cool despite record low rates. 

As widely anticipated, the RBA has left the official cash rate on hold at 1.5 per cent.

Australia’s top economists and market commentators were united in predicting another hold, including Leanne Pilkington, managing director at Laing+Simmons, who said increasing it now would have been unwise. 

“Subdued housing transaction activity and price declines in some markets make an interest rate increase in the near term an unnecessary risk,” she said. 

Advertisement
Advertisement

“A strong labour market will be a key factor supporting the economy as we look to the new year.”

Economist Saul Eslake held a similar view, saying that an increase is still some way off.

“Some of [the RBA’s] recent commentary appears to indicate slightly greater near-term concerns with regard to the possible consequences of declining property prices and greater risk aversion on the part of lenders.

“Although the RBA remains optimistic on the outlook for economic growth and unemployment, it still sees inflation returning only 'gradually' to the bottom of its 2-3 per cent inflation target.”

Equally optimistic, chief economist at REA Group Nerida Conisbee also felt the RBA would hold rates as is – at least for the time being.

PROMOTED CONTENT


“There are some really positive economic indicators out there at the moment. In particular, the unemployment rate is very low and this should lead to wages growth. Nevertheless, at this stage, I believe they will hold and review when they meet up again next year.”

Head of corporate affairs at Mortgage Choice, Jacqueline Dearle, agreed that there is nothing in the market to prompt a change. 

“With little change in inflation and wage growth, plus a positive outlook for the labour market, the economic backdrop suggests the Reserve Bank of Australia will hold the official cash rate at 1.5% in December,” said Ms Dearle.

[Related: RBA announces November cash rate]

RBA reveals pre-Christmas cash rate
rba
TheAdviser logo

Are you a new-to-industry broker in the process of growing your business? Then there’s some great news: The Adviser’s New Broker Academy is back in 2021 and will provide you with essential insights into cutting-edge tools, strategies and processes to fast-track to success. Don’t miss your chance to attend. To secure your FREE place, visit newbroker.com.au now!

rba

 

more from the adviser
Blake Albones Bank announces new head of home lending distribution

MyState Bank has hired the CEO of RateOne and former NAB head of ...

Sydney Sydney mayor launches business support, calls for JobKeeper

Sydney’s mayor has urged the federal government to resurrect Jo...

mortgage payments money Banks accused of bias against BNPL in lending process

An executive from buy now, pay later provider Zip has echoed repo...